With the narrow approval of Ballot Measure 25 during the November 2002 General Election, Oregon’s minimum wage will increase to $6.90 per hour, effective January 1, 2003.

As many may recall, the minimum wage was last increased in 1996 with the passage of Ballot Measure 36. Previously, the minimum wage had been $4.75 per hour since 1991. Pursuant to the 1996 ballot measure, the minimum wage was increased to $6.50 per hour over a three-year period, increasing from $4.75 to $5.50 per hour effective January 1, 1997, from $5.50 to $6.00 for calendar year 1988, and then to $6.50 for calendar year 1999 and thereafter.

With respect to the immediate increase, it should be noted, the Ballot Measure 25 not only provides for an increase from $6.50 to $6.90 beginning January 1, 2003, but also calls for annual adjustments based on a determined rate of inflation for calendar year 2004 and beyond.
In accordance with the 2002 measure, the Commissioner of the Bureau of Labor and Industries is required to calculate an annual adjustment in the minimum wage. The adjustment is based on any increase during the previous 12 months in the U.S. City Average Consumer Price Index for All Urban Consumers for All Items as prepared by the U.S. Department of Labor. The Commissioner is required to complete this calculation by September 30 of each year and apply the rate of adjustment to the minimum wage for the following calendar year. The minimum wage is to be rounded to the nearest five cents and will become effective on January 1 of the year following each adjustment.

Possible Questions:
Q. If I paid my employees $6.75 per hour in 2002 (25 cents above the minimum wage), am I legally obligated to pay at least $7.15 per hour (again, 25 cents above the minimum wage) as of January 1, 2003?

A. No. The law only requires you to pay the minimum wage of $6.90 per hour as of January 1, 2003, unless you have a contract or policy providing otherwise.

Q. Can I pay my new employees a training wage which is below the minimum wage?

A. No. Unlike federal law, Oregon law requires that employees receive at least minimum wage during all stages of employment, including any period of on-the-job training.
Q. If my pay period cuts across December, 2002 and January, 2003, which minimum wage applies?

A. The 2002 minimum wage of $6.50 applies for all hours worked during December, and the 2003 minimum wage of $6.90 applies for all hours worked during January, without regard to your particular pay period or pay date.

If you have other questions, or would like to receive a copy of the actual wording of the 2002 Ballot Measure, please contact the ONSA Administrative Office in Salem.

Oregon Minimum Wage:
01-01-1991 $4.75
01-01-1997 $5.50
01-01-1998 $6.00
01-01-1999 $6.50
01-01-2003 $6.90

Technical Assistance for Employers is available from the Oregon Bureau of Labor and Industries, call: (503) 731-4200, option 4